The Department of Energy granted PXP Energy Corp.’s request to place Service Contract 74 under a technical moratorium until Sept. 13, 2024 to conduct more studies in the Linapacan field.
PXP said in a disclosure to the Philippine Stock Exchange the moratorium would give the company more time for further studies and establish the appropriate technology to increase the production rate and recoverable reserves from the Linapacan B Field that will warrant an economically-viable production.
PXP recently completed studies in SC 74 which indicated that the Linapacan “A” and “B” fields contain 43.16 and 27.43 million barrels of contingent oil resources respectively.
The company also identified two leads, namely South Linapacan and Edapacan, located on the southwestern and northeastern parts of the Linapacan Fields, respectively.
PXP completed the technical evaluation and resource assessment of the Linapacan A and B fields and South Linapacan Prospect last year.
“The appraisal/conceptual development strategy phase of the study focused on the Linapacan B Field as the results of the initial evaluation indicated that Linapacan A Field and South Linapacan Prospect are not viable to develop and produce with the present technology,” the company said.
PXP said the lowest cost option for developing the Linapacan B Field comprises two subsea completed wells and an 11-kilometer tie-back to a future West Linapacan floating production storage and offloading vessel.
The study, however, showed that Linapacan B is “uneconomic as the minimum economic field size required is 5.1 mmbbl.”
PXP said the SC 74 joint Venture remained optimistic on other development options that were not considered in the study that could improve the economics of either a standalone development of Linapacan B Field or a joint development with West Linapacan A and B fields.
The joint venture decided to request a technical moratorium with the DOE to evaluate other development options for the Linapacan B Field.
“Each of PXP and Forum will continue to coordinate with the government on the resumption of activities in both SC 75 and SC 72. Meanwhile, the Group shall continue to pursue exploration work with respect to its other projects in the Philippines, including SC 40 and SC 74,” PXP said.
PXP reported a higher net loss at P5.3 million in the first quarter compared to P2.8-million loss in the same period last year.